Federal Committee Clears Icon’s Investment By Chinese

Icon A5
Icon A5
Credit: Icon

The Committee on Foreign Investment in the U.S. (CFIUS), a federal interagency panel under the Treasury Department, has cleared Icon Aircraft’s investment by its Chinese majority investor. 

The panel began a review of the Icon Aircraft and its A5 light sport amphibious aircraft in November 2021 amid allegations of a national security risk and improper transfer of technology and materials to the Chinese following majority ownership of the company to Pudong District Science & Technology (PDSTI), which has the controlling interest. 

“We’re pleased to confirm that after a months-long, thorough, and comprehensive investigation, CFIUS has cleared PDSTI’s investment in Icon Aircraft,” Icon said in a statement. “Icon will now be able to focus even more on doing what we do best—manufacturing and selling the incredible Icon A5 amphibious light sport aircraft. We will continue our operations and plan to increase our pace of sales and marketing activity as we approach our peak sales season.”

The Treasury Department did not immediately respond to a request for comment.

The investigation was initiated by minority Icon shareholders and Icon’s former CEO and Founder Kirk Hawkins. The group alleges the Chinese investor wants to use the Icon A5 for military purposes. The group also filed a lawsuit in June 2021 against the majority investors for allegedly seizing control and aiming to hollow out U.S. operations to export Icon’s intellectual property, composite technology and manufacturing to China. It contacted the Committee on Foreign Investment in April 2021.

“As CFIUS had a responsibility to do in response to such allegations, it initiated an investigation and thoroughly examined the Chinese investors and the potential applications of the ICON A5,” Icon said in its statement. 

According to court documents, PDSTI approached Hawkins about investing in the company and purchased $100 million in Icon shares in 2015 and became the majority shareholder in 2017. Hawker said he was not aware at the time that PDSTI is partially owned by the People’s Republic of China. 

Icon officials allege that Hawkins’ aim was to regain control of the company after he was terminated. Hawkins disagrees.

“This is not about any individual interest,” he said earlier in a statement. “It is about protecting a U.S. company from nefarious investment practices by the PRC (People’s Republic of China.)

Molly McMillin

Molly McMillin, a 25-year aviation journalist, is managing editor of business aviation for the Aviation Week Network and editor-in-chief of The Weekly of Business Aviation, an Aviation Week market intelligence report.